Melbourne-based mortgage broker Bernard Desmond recounts his painstaking process of choosing a new aggregator for his business.
Speaking to The Adviser’s Elite Broker podcast, the founder and CEO of Blank Financial said he decided to switch to Specialist Finance Group (SFG) three years after becoming a broker.
However, choosing a different aggregator was a decision he made lightly or in haste.
In fact, Mr Desmond, who established Blank Financial in March 2020, said he spent more than a year researching and speaking with different aggregators before zeroing in on the aggregator that suited his needs.
He described the process as one of the hardest and time-consuming decisions he has had to make.
“It wasn’t something that I just got up one day and said, ‘Let’s change aggregators’,” he said.
“I did take a lot of time in doing this, and it is a process that I probably wouldn’t undertake frequently.”
Mr Desmond, who recently won the Customer Service of the Year Award - Individual at the Australian Broking Awards 2020, said he assessed aggregators against a criteria list to ensure it suited him.
He examined their model, and whether they are a wholesale aggregator or a franchise aggregator, how much it would cost him to obtain that service, and whether they are commercially viable.
He also acknowledged that his current criteria list had evolved compared with three years ago.
“When I was selecting an aggregator three years ago, I looked at that point with a different requirement. I wanted an aggregator three years ago who could get me up and running pretty quickly,” Mr Desmond said.
“The brand was not the requirement for me. Eventually I would come up with my own brand, but at that point I wanted a plug-and-play situation so I could just go from being a banker to being a broker and start producing from day one.
“I am now the brand and I am bringing a lot to the table, so I wanted to be with an aggregator that was commercially playing in my favour.”
When choosing an aggregator, Mr Desmond researched their CRM capabilities and platform offerings.
In addition, he wanted to choose an aggregator with a healthy mix of lenders that would enable him as a broker to offer a broader product suite for his clients.
Mr Desmond also researched the aggregator’s ownership structure, how long they have been in the market, and their reputation and track record among other brokers.
“In the end it came down to value commercially, systems, and then one-on-one interactions with the owners of the business: are they equally invested in me to take my business to the next level?” he said.
“Those three things put together made it quite easy for me to choose SFG as an aggregator.”
As part of his research, Mr Desmond spent more than a year engaging in discussions with various aggregators in the mortgage broking market.
He met SFG a year ago at an event that he hosted in Melbourne, and chose the aggregator after almost a year.
Tips for new brokers in picking an aggregator
Having emerged on the other side of this extensive process, Mr Desmond suggested that new brokers could join an aggregation business and work under them.
However, for established brokers such as himself, Mr Desmond advised that it is vital to carve out some time to plan a smooth transition when switching aggregators to ensure that clients are not disrupted.
“When you move from one aggregator to the other, you will have some down time,” he said.
“In my case, I planned it quite well. I did the move around the December period when I actually went overseas. I didn’t have any downtime even though I had allowed for it.”
“Before actually moving aggregation groups and before giving notice to my outgoing aggregator, I actually finished up all the aggregations that I had. I wasn’t taking any more deals because I knew that I was going to go through this change.”
To avoid the down time, Mr Desmond recommended that brokers should ensure that all their files are sorted before they transition to a new aggregator.
Mr Desmond finished with his previous aggregator on 28 February this year, and joined his new aggregator a couple of days later.
“You just have to work with every stakeholder and make sure that you have a smooth transition,” Mr Desmond concluded.
To listen to the full podcast with Bernard Desmond, click here.
Malavika Santhebennur is the features editor on the mortgages titles at Momentum Media.
Before joining the team in 2019, Malavika held roles with Money Management and Benchmark Media. She has been writing about financial services for the past six years.
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